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Tuesday, September 4, 2012

Time for answers from DiBello, Part 2

Whatever happened to that $20,000 car?
DiBello fundraising video - note the scroll at the bottom
By Will Collette

On June 25, Councilor Lisa DiBello used the Council dais to call me a liar and to announce her bid for re-election.

On June 27, I called DiBello out by listing 20 questions in three categories based on my past coverage of her conduct. These questions – all backed up with documentation – concerned DiBello’s conduct as a town official and as president of a Charlestown quasi-charity.

She has not answered. So here is another installment where I present the results of my research, including new research uncovered in recent weeks.

Among the most disturbing unanswered parts of DiBello’s record is her leadership of a Charlestown charity called A Ray of Hope. It had the lofty purpose of helping children and families who suffered some sort of personal catastrophe, such as a fire.

During its first few years, based on statements DiBello and her board members (almost all of whom were town employees or contractors) made to the press, it appears that A Ray of Hope raised $100,000 or more. Click here to read those news clips.

As part of my research, I sought to examine two sets of public records that nonprofits are required to file as a condition of their nonprofit status. These records are also supposed to make sure charities are accountable for how they raise and spend money.

The most important of these records are annual federal 990 reports filed with the Internal Revenue Service. 

Click here for an example. Nonprofits must also file simple annual reports with the state’s Secretary of State. Click here for an example.

DiBello has refused to provide copies of those IRS-990 reports, as required by law. These reports do not seem to be available from any source – the IRS did not have any when I asked for them under the Freedom of Information Act. It’s quite likely that DiBello never filed a report – especially critical during the early years of the charity’s life when it appeared to be raising a lot of money. 

Current records show that DiBello now files reports to IRS saying she has nothing to report. While I don't doubt that the charity is now just a shell, there's still the matter of what happened to all the money she raised in A Ray of Hope's early days.

Legitimate charities make their IRS-990 reports readily available to the public, as required by law. Many are proud to do so, because these forms detail exactly how much money was raised and how it was spent. Legitimate charities have nothing to hide and do not hesitate to comply with the law requiring transparency. But that's not how DiBello has run A Ray of Hope.

 In 2001, DiBello appeared as a contestant on The Price Is Right. Coached by her brother Mark Anthony DiBello, she won the show’s grand prize, a brand-new Oldsmobile Alero, worth more than $20,000.
Lisa’s brother Mark produced a fundraising video for the charity that included not only Lisa’s performance on the game show but also a news clip showing Lisa celebrating with friends at the Cove. In the video, DiBello tells Channel 12 that she will be donating the car (or the proceeds from its sale) to A Ray of Hope.

Here's the YouTube link for the DiBello fund-raising video:

A pitch for viewers to send money appears in the video, including an ending slide giving information on where to send the money. Donors are directed to send the money to Mark Anthony DiBello’s PayPal account in California.

See the slide to the (left)

This video raises a lot of serious questions, such as the propriety of having donors send the money to Mark Anthony DiBello’s PayPal account. Presumably, A Ray of Hope’s IRS-990 reports – if they exist – would show how this family arrangement worked, including how much Mark Anthony DiBello was paid to produce the video and handle the donations. 

But I wanted to know about the car. The car, worth more than $20,000, represents a pretty hefty gift to the charity. And, after all, DiBello’s generous pledge was a key feature in the fundraising video. Since the video was posted on the internet, the claims in the video must be true, or else this is, at best, false advertising and, at worst, wire fraud.

I checked town records and discovered that not only did DiBello KEEP the car, she ended up giving it to Deborah DeLollio.
Dellolio kept the car DeBello promised to the charity in the fund-raising video

Deborah Delollio, at the time, was a town contractor who ran The Dog Pound and held a 10-year monopoly on the town concession contract for Charlestown Town Beach.

Under Lisa DiBello’s oversight and supervision. Delollio is also Lisa DiBello’s housemate, a fact that is never disclosed on DiBello’s annual financial disclosure filings with the RI Ethics Commission. 

Delollio is also, along with DiBello, a founder of A Ray of Hope and has held the position of Vice-President from then until now.

The Oldsmobile Alero, publicly pledged by DiBello to the charity, ends up the property of DiBello’s housemate and fellow charity officer. IRS calls this self-dealing and forbids it.

I wrote about this in October 2011. I posed the same questions then that DiBello has refused to answer now: How do you explain featuring your pledge to donate the car in a fundraising video and then not honoring your pledge? Why did you give it to Dellolio when IRS regulations forbid such self-dealing?

Shortly after I went public with this information last October, the DiBello-Dellolio Oldsmobile received some official attention.

Charlestown Police found it sitting outside South Shore Mental Health on December 9 with no front tag, expired inspection sticker and suspended registration and towed the car away.
Official Charlestown Police report
I don’t know where the car is now. But by now, the paper trail makes it crystal clear that the car was never donated to A Ray of Hope as DiBello promised – and used as a fundraising hook in the video.

Some die-hard Lisa DiBello fans will ignore this evidence of nonprofit malfeasance and say I’m just picking on poor Lisa. 

But she chose to set up a nonprofit and to run it with her housemate, friends and brother without meeting the minimal accountability requirements set by IRS. I didn’t compel her make that promise on Channel 12 News or force her to put it in her fundraising video. And I didn’t make it up, either. 

DiBello drew a lot of town employees into her "charity." Some of them served on her board. One of them, Joann Santos (Charlestown Tax Collector), has served as A Ray of Hope Treasurer and in that position had a fiduciary responsibility to make sure the organization obeyed the federal tax code and filed federal and state reports on time. They and the other board members are legally and financially responsible.

A lot of Charlestown residents and businesses gave money to A Ray of Hope during its first few years, before DiBello seemed to have allowed it to go entirely to seed. Where is the accountability for what she did with the money?

And is this the kind of person fit to hold the public’s trust as an elected official?

Read Part 1: click here.